Lawmakers quiz CUC on long-term plans for engines

Members of the Senate and House committees on Public Utilities, Transportation, and Communication expressed concern yesterday whether the Commonwealth Utilities Corp. is capable of overhauling the power plant engines on time or will it end up extending the Aggreko contract for temporary generators.

“We’re just concerned with the funding issue, whether there is enough money to complete the repairs of the engines and how we can avoid actually extending Aggreko contract,” Sen. Paul A. Manglona told Saipan Tribune shortly after the joint Senate and House PUTC’s meeting with CUC executive director Antonio Muña.

During the meeting, Muña explained, among other things, CUC’s power situation, the availability of $5.4 million for the planned engine overhaul and rehabilitation, the option to extend Aggreko’s contract, and the Aggreko generators’ compliance plans with U.S. Environmental Protection Agency regulations.

Manglona, who chairs the Senate PUTC, pointed out that it is costing the CNMI more to extend the Aggreko contract than pumping in more Capital Improvement Project money now.

“By leasing [generators] from Aggreko, we need to use operational funds. At the same time, many members of the Legislature are becoming frustrated with the way these [power] engines are being put up for repair proposals, putting out bids, then cancellation,” he said.

This shows, Manglona said, that CUC doesn’t have a handle yet on how to properly put this overhaul and rehabilitation project up for bidding.

The senator said that Muña has assured lawmakers that he is putting somebody on board in January 2009 to oversee the project.

CUC recently hired Wallon Young, a former official at the American Samoa Power Authority, as deputy director of utilities system rehabilitation. He starts work in January.

“Hopefully this person to be paid out of 702 funding can put his finger on the numbers and on the scope of work and the time frame that we need to do this project,” Manglona said.

CUC, he said, should get back on track to eventually resolving all these temporary power solutions and move toward a long-term solution, which may be semi- or full privatization of CUC, just like in Guam.

Manglona cited that the Guam Power Authority is doing a good job in putting out requests for proposals and bidding requirements and their independent power producers have good records.

“Since the power company is run efficiently and we’re still way [off] from that, we hope we can learn a lesson from our neighbor,” he said.

Manglona said the PUTC would be working with Muña so that by February, CUC will have a definite plan as to how it will address the power crisis.

Rep. Diego Benavente said EPA has allowed Aggreko to operate on the understanding that it is only on a temporary basis. If EPA disallows the use of Aggreko generators, then Saipan will suffer outages again.

Rep. Justo Quitugua said he first heard about the RFPs for the overhaul/rehabilitation project three years ago. “We should solve this rehabilitation [issue] once and for all. CUC should have an expert on RFPs.”

Quitugua also asked how much CUC actually needs for the rehabilitation project if the $5.4 million that CUC has on hand is not enough.

Rep. Francisco Dela Cruz also asked CUC if it has a contingency plan should EPA order Aggreko to shut down in 30 days. He also brought up Telesource’s previous offer to help Saipan with its power crisis.